Most members of Congress avoided worst of recession

WASHINGTON — If you could peer deeply into how the 535 members of Congress handle their money, what would you find?

You would see a diversity of investment strategies and results, from those who put their money into riskier, high-growth funds to those who own safe municipal bonds. The legislators range from the super-rich to the deep-in-debt, from inherited wealth to married wealth to no wealth at all. They are entrepreneurs and farmers, oilmen and ranchers, lawyers and real-estate developers.

You would find that, contrary to many popular perceptions, lawmakers don't get rich by merely being in Congress. Rich people who go to Congress, though, keep getting richer while they're there.

The wealthiest one-third of lawmakers were largely immune from the Great Recession, taking the fewest financial hits and watching their investments quickly recover and rise to new heights. But more than 20 percent of the members of the current Congress — 121 lawmakers — appeared to be worse off in 2010 than they had been six years earlier, and 24 saw their reported wealth slide into negative territory.

Those findings emerge from an ongoing examination of congressional finances by The Washington Post, which analyzed thousands of financial disclosure forms and public records for all members of Congress.

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Most members of Congress weathered the financial crisis better than the average American, who saw median household net worth drop 39 percent from 2007 to 2010. The median estimated wealth of members of the current Congress rose 5 percent during the same period, according to their reported assets and liabilities. The wealthiest one-third of Congress gained 14 percent.

Because lawmakers are allowed to report their holdings and debts in broad ranges, it is impossible for the public to determine their precise net worth. They are not required to reveal the value of their homes, the salaries of their spouses or money kept in non-interest-bearing bank accounts and their congressional retirement plan.

Because of the imprecise financial disclosure system, estimations of wealth can be off by millions.

For example, reports for Rep. Nita M. Lowey, D-N.Y., between 2004 and 2010 show that her wealth most likely increased by as little as $1 million or as much as $20 million, as framed by the changes to the lowest and highest possible totals of her reported assets. The Post analysis, which takes the midpoint of the ranges, estimated the increase at $11 million.

That figure is inaccurate, said her spokesman, Matt Dennis.

"The Loweys' net worth did not increase by anywhere near $11m from 2004-2010 — the metric you're using presents a hugely distorted picture," Dennis said in an e-mail.

He declined to provide more accurate values for the assets of Lowey, a 12-term congresswoman, who is married to a partner in a White Plains, N.Y., law firm.

"They're entitled to a certain level of privacy with their finances," Dennis said in an interview. "That's why the system is the way it is. They want a certain standard of disclosure without sacrificing their personal privacy."

The analysis shows that lawmakers who were well-off before the financial crisis of 2008 saw portions of their portfolios level off during the darkest days. But most of these lawmakers managed to maintain their financial footing and emerge far wealthier than they had been earlier in the decade.

Some of the richest members of Congress watched their portfolios soar between 2004 and 2010. Of the 72 lawmakers whose estimated wealth doubled during that time, it appears that 11 increased portfolios by at least $10 million, based on the midpoint of their reported ranges.

Rep. Kenny Marchant, R-Tex., posted an estimated $22 million gain. House Minority Leader Nancy Pelosi, D-Calif., saw an estimated $60 million increase in her reported wealth as the value of her husband's commercial real estate holdings in San Francisco climbed during the first decade of the century.

"This is really driven by real estate that he has held, some of it inherited, for a number of years," Pelosi spokesman Drew Hammill said. "San Francisco is one of the places where the market has skyrocketed in terms of price per square foot and has been fairly insulated in terms of the 2008 financial crisis."

Another Californian has consistently ranked in the top five of the richest House members: Rep. Darrell Issa, a Republican. He has also been one of the most successful investors on Capitol Hill, with estimated wealth of $448 million in 2010, according to The Post's analysis.

Not all members of Congress were immune from the financial meltdown. Rep. Steny H. Hoyer, D-Md., rose to political heights in the middle of the decade — he became House majority leader in 2007 — but his finances failed to follow suit. His reported wealth declined by an estimated 90 percent between 2004 and 2010.

Among the findings

• The estimated wealth of Republicans was 44 percent higher than Democrats in 2004, but that disparity has virtually disappeared.

• The number of millionaires in Congress dropped after the Great Recession. The 253 who have served during the current session are the smallest group since 2004. The numbers are likely to be underestimated because lawmakers are not required to list their homes among their assets.

• Between 2004 and 2010, 72 lawmakers appeared to have doubled their estimated wealth. At least 150 lawmakers reported receiving more income from outside jobs and investments than from their congressional salaries of $174,000 for rank-and-file members.

• Representatives in 2010 had a median estimated wealth of $750,000; senators had $2.6 million.

• Since 2004, lawmakers reported more than 3,500 outside jobs paying their spouses more than $1,000 a year. The lawmakers are not required to report how much they are paid or what the spouses did for the money.

• Lawmakers' wealth is held in a variety of ways: 127 primarily in real estate, 117 in institutional funds, 75 in their spouses' names, 51 in essentially cash, 36 in specific stocks and bonds, 32 in high-turnover trading, 30 in business ownership and 20 in agriculture. Forty-six had reported assets of $25,000 or less.

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